The 9. Issue #4

Presenting The 9. Issue number 4.

This month our advice for Start-up Businesses comes from Casey Graham from abrdn , Martin McQuillan from Cirrus IT Systems , and from Cathy Brown from Imperium Cashflow.

They will provide their expertise to deliver your top 3 tips in #Finance, #IT and #CreditControl.

3 Top Tips from 3 Experts in their field. 3 X 3 = The 9

Let's begin

Starting a business is likely to be one of the biggest risks you’ll take but just like any investment, risk shouldn’t be avoided, it just needs to be managed. ?

When you have a clear idea of cashflow you should be mindful of these money phases ?

1. The Present:Have an emergency fund of at least 3-6 months’ worth of working capital and monthly bills accessible. Business savings rates aren’t as favourable as personal ones but it’s important to be able to get money quickly if need be.?
2. The 5-10+ year plan: How can you scale up and become more profitable? You might need to spend money to give you capacity to make more money (ie equipment, employees, outsourcing).?
3. The Future: Start saving for your financial freedom as early as possible. Pensions (aka Retirement Accounts) are just ‘glamorous’ savings accounts that give very generous tax reliefs whilst allowing you to extract profits from the business. ?

Start off by investing small consistent amounts over your working life but be sure to increase this as the business grows.

The idea is you are saving money now to pay yourself later. This will build up over time and hopefully you will be able to retire when you want to and enjoy the lifestyle that you hope for.

As Einstein said “compound interest is the 8th?wonder of the world” so don’t underestimate how beneficial this can be over a long period of time.

Casey

Cashflow Tips for new business

1. Help your customer to pay you.

Send invoices quickly, it can be hard to keep on top of the paperwork but consider that there may be future delays – timely invoicing will mean you can resolve any queries quicker an have the cash in your bank.

Have clear payment terms on each invoice, these include

? The amount due

? The due date

? Payment method, with details of how to pay

? Any prepayment discounts

? Late payment penalties

Offer different Payment Options, there are a large range of suppliers that offer online payment services for card or transfer.

If you regularly invoice the same customer then request that they use a Direct Debit system. These have become easy to set up for any size of business and will sometimeshave the added bonus of feeding into any digital accounting software.

2. Manage your expenses effectively

Having detailed records of your expenses is vital. When the business is having a growth period of cash coming in it can be easy to lose focus on the costs going out. However regular audits of the expenses can quickly identify where costs can be cut.

As an example, utilizing video software and virtual meetings would reduce travel expenses. Or going digital with the business will reduce printing and paper costs. We are big fans of having accountsdigitalised.

Manage outgoing payments efficiently. If given credit terms by your supplier then use them, this will allow for a healthy cash flow cycle. The time between your cash outflow and cash inflow is crucial to the business.

3. Have a separate account for saving funds

Get into the habit of setting aside money as it comes into the business, this means there are no nasty surprises when it comes to paying VAT, PAYE or TAX. When starting out it is easy to get into the habit of using all the cash as it comes in however this is false economy as it is additional money that will need to be found when the time comes to paying those bills.

This account can be used for a little bit extra for an emergency fund for when that time comes that cash flow becomes a problem.

Cash flow is as important as profit. In some cases it can become more critical however it is easy to focus on the profit and forget about the other. Effectively managing your cash flow has many other benefits, including being prepared for unexpected emergencies and future growth.

The best of luck.

Cathy

IT for Startups.

It is natural to start thinking about IT for your new business as simply a few laptops or a few desktop PCs.

Some might even have a Line of Business application in mind that will make the day to day that bit easier. Today however I am going to touch on a slightly different angle.

In our last edition Stephen Murray ?from? UBRANDiT ?touched on the importance of brand identity,and I’d like to continue in that vain by looking at your domain name and how important it is.

It is easy to go down the route of staying with our generic email providers, they are free and we certainly know how to use them.

So my top tips around this are:

1: [email protected] may be easy to setup and familiar to use but it may also look cheap.

Think about the combination of your brand design and identity, the image you want to portray and combining this with your website and email addresses.

2: The generic emails accounts suffer from overuse and abuse. Therefore you can be affected by spam filters and delivery issues, especially if you are business to business.

3: Once you have your domain setup, the IT benefits are huge. You can now access services such as Office 365 to

• manage your emails simply,
• add functionality to your website,
• add safe secure access anywhere data storage to your day to day operations
• avail of an unlimited amount off the shelf online apps for you or for your clients.

The difference a quick trip to godaddy.com or 123reg.co.uk and ￡9.99 can make to your business is huge.

It’s also a great way to start thinking about all the crossovers in the multiple hats you find yourself wearing as a startup.

Keep you business and your data safe.

Marty

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